Engineering Tomorrow: AVL, Pininfarina, and Horiba MIRA Reshape Automotive Services Market

 

The global Automotive Engineering Services Market is set to expand significantly, growing from USD 1.8 billion in 2025 to over USD 3.5 billion by 2035, at a CAGR of 6.9% during the forecast period. This growth is being driven by the rising reliance of original equipment manufacturers (OEMs) on outsourced engineering services, particularly in areas such as vehicle electrification, simulation, and digital architecture development.

With the global push toward electric mobility, connected cars, and autonomous driving, automakers are increasingly partnering with engineering service providers to access specialized skills and speed up product development. These services play a vital role in reducing time-to-market, optimizing production, and ensuring regulatory compliance in a rapidly evolving industry landscape.

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Market Trends

Shift to electrification and battery management system design

Rapid digitalization across vehicle platforms and services

Rise in over-the-air (OTA) software updates and connectivity services

Integration of AI and ML in vehicle testing and simulation

Focus on sustainability in vehicle design and life cycle engineering

Driving Forces Behind Market Growth

Increased R&D spending by OEMs to stay competitive

Complexity of modern vehicle architecture, requiring expert engineering

Need for faster prototyping and validation to meet launch targets

Global expansion of EV and hybrid vehicle manufacturing

Regulatory mandates for emissions, safety, and autonomy

Challenges and Opportunities

Challenges:

Rising cost of engineering talent and tools

Intellectual property (IP) protection concerns in outsourcing

Variability in global engineering standards

Opportunities:

Demand for end-to-end product lifecycle services

Expansion into software-defined vehicles (SDVs)

Growth in ADAS (Advanced Driver Assistance Systems) integration support

Engineering support for regional EV startups and mobility platforms

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Recent Industry Developments

May 2025 – Tata Technologies partnered with global OEMs to provide cloud-based digital engineering services.

February 2025 – AVL launched a simulation platform for full-vehicle electrification testing.

December 2024 – Bertrandt AG opened a new innovation hub focused on autonomous vehicle systems.

October 2024 – Ricardo plc expanded its EV engineering service division in Southeast Asia.

Regional Analysis

North America:

High demand for connected vehicle platforms

Strong partnerships between OEMs and tech firms

Europe:

Focus on low-emission vehicle technologies

Leadership in automotive simulation and testing services

Asia-Pacific:

Fastest-growing market due to booming EV startups and OEM outsourcing

China and India leading in digital engineering investments

Latin America & MEA:

Steady growth in vehicle design and localization services

OEMs exploring nearshore outsourcing to reduce costs

About Future Market Insights (FMI)

Future Market Insights, Inc. (ESOMAR certified, recipient of the Stevie Award, and a member of the Greater New York Chamber of Commerce) offers profound insights into the driving factors that are boosting demand in the market. FMI stands as the leading global provider of market intelligence, advisory services, consulting, and events for the Packaging, Food and Beverage, Consumer Technology, Healthcare, Industrial, and Chemicals markets. With a vast team of 400 analysts worldwide, FMI provides global, regional, and local expertise on diverse domains and industry trends across more than 110 countries. 

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